Ottawa probing iGate after RBC outsourcing backlash

The federal government is investigating iGate, the external firm used by Royal Bank of Canada to outsource dozens of Toronto-based IT jobs.

A spokesperson for Human Resources Minister Diane Finley said application documents submitted by the offshoring firm which has imported workers to provide certain technical services to RBC is being reviewed.

Alyson Queen said there are discrepancies between public statements provided by RBC and information which had been previously submitted by iGate.

"HRSDC officials are currently reviewing the labour market opinions submitted by iGate in great detail, based on apparent discrepancies between RBC's public statement and information which has previously been provided to the government," Queen told The Canadian Press.

In order to obtain permits for temporary foreign workers, companies must show that a qualified Canadian cannot be found to perform the work.

Immigration lawyer Chantal Desloges told CTV News Channel that as the investigation into iGate moves forward, it will be “interesting to know whether Service Canada dropped the ball on this one by giving iGate the approval.”

Canada’s largest bank has said it does not hire temporary foreign workers to perform the duties of current bank employees. But 45 of RBC’s employees in Toronto are losing their jobs next month after the bank contracted a number of technological services to iGate which brought in its own employees. The replacements will be trained by the soon-to-be former RBC employees.

The bank said it recognized the impact of their decision, adding they are helping to “retrain, redeploy” and help its employees transition to other positions.

Desloges said RBC did “nothing illegal or even wrong” by hiring iGate.

RBC’s CEO Gord Nixon said the media has been “oversimplifying the situation.”

“Most of the iGate employees who will return are senior people who are involved in the transition with respect to the IT processes and services,” Nixon told CTV News.

But the practice of hiring temporary foreign workers and having them trained by RBC employees is angering some staff members.

According to an RBC employee who asked to not be identified, the replacements stay for a short period of time and then leave, taking their positions with them.

“Depending on the position that they are going to be taking over, we’ve seen them here in Canada anywhere between a couple of months to well over a year,” the RBC employee told CTV News in a phone interview.

“They’re using the techniques put in place by the Conservatives to lower the working conditions of Canadian workers,” Mulcair told reporters.

He said RBC should reverse their decision to replace the workers and apologize to Canadians, and added that the Conservatives must rethink the temporary foreign workers program.

The program allows employers to hire foreign nationals to fill temporary labour and skills shortages when qualified Canadians or permanent residents are not available. Traditionally, the program has been used by the agricultural sector and for live-in caregivers.

“It’s now more akin to a situation where the person serving you in a Tim Hortons is likely to be a temporary foreign worker,” Mulcair said. “We’ve got lots of Canadians who are still looking for work. More than a million-and-a-half Canadians looking for work, it doesn’t make any sense for the Conservatives to be pursuing this program.”

The federal government has said it will review the program out of a fear that employers are using it to fill long-term positions instead of on a temporary basis, as intended.

RBC’s reputation took a hit over the weekend, with a number of customers taking to social media to blast the bank over what they deemed unfair hiring practices.

The decision to replace the 45 employees comes as the latest employment numbers from Statistics Canada shows 54,500 jobs disappeared from the economy in March.

A Facebook group called “Boycott Royal Bank of Canada” formed over the weekend, and had more than 3,500 ‘Likes’ as of Monday afternoon. An online petition is also circulating calling for a boycott of RBC.

And many RBC clients are also expressing disappointment in the bank.

“I got a little ticked off and I thought there’s got to be something we can do as Canadians,” Brian Cyr, a former RBC Client, told CTV News.

Meanwhile, the bank claims that it is not hiring foreign workers to take over the jobs of current employees, as technically those who fill the 45 jobs will be employees of iGate, not RBC.

“We always look at what’s the best way to do our various different processes and what’s the best way to be able to service our clients. And in this case, we decided that it makes sense to work with a supplier to have them perform the services,” RBC’s chief human resource officer Zabeen Hirji said.

Hirji told CP24 on Monday that RBC will work with the employees to help them find other jobs.

She noted that the bank has about 57,000 employees in Canada.

“If you put it in perspective, this a small initiative and one that’s part of normal business practice,” she said. “I think it’s important as well to understand, we are not replacing RBC employees with temporary foreign workers.”

Mulcair said RBC is using “precisely the right choice of words” in defending it decision to outsource the jobs.

“At the end of the day the employee who is losing his or her job doesn’t care what kind of loophole it is. All they know is we have a Canadian government that is allowing this to take place,” he said.

Human Resources Minister Diane Finley issued a statement over the weekend saying the RBC situation is “unacceptable” if it is true.

The bank's move to clarify its hiring strategies came after a news report quoted a Toronto employee working in IT for RBC’s Investor Services as saying he and dozens of others were losing their jobs to temporary foreign workers.

With a report from CTV Ottawa Bureau reporter Danielle Hamamdijian and files from The Canadian Press